Danaos Reports Unaudited Results For Fourth Quarter And 2006

ATHENS, GREECE -- Danaos Corporation (“Danaos”) (NYSE: DAC), a leading international owner of containerships, today reported unaudited results for the fourth quarter and the twelve month period ended December 31, 2006.

Highlights:

-- Reported net earnings of $30.6 million or $0.57(1) per share and
$101.1 million or $2.16(1) per share respectively for the fourth quarter
2006 and twelve months ended December 31, 2006
-- Operating Revenues of $69.2 million and $245.6 million respectively
for the fourth quarter 2006 and twelve months ended December 31, 2006
-- EBITDA(2) of $46.6 million and $163.3 million respectively for the
fourth quarter 2006 and twelve months ended December 31, 2006
-- During the fourth quarter of 2006 Danaos took delivery of three 4,814
TEU container vessels, the Maersk Marathon, Maersk Messologi and Maersk
Mytilini respectively, each of which were subsequently fixed under a 5-year
charter to the A.P. Moller-Maersk Group, as well as a fourth containership,
the 9,580 TEU newly built CSCL Le Havre chartered to China Shipping for 12
years.

Danaos’ CEO Dr. John Coustas commented: "The fourth quarter of 2006 was particularly important for Danaos since it marks the listing of our shares on the New York Stock Exchange. We thank our new shareholders for their continued support and shall continue to be in close touch with them and the broader investment community to keep them informed on the performance of our company and the new growth opportunities as they come along.
"In the fourth quarter of 2006 we acquired and took delivery of the three secondhand, 4,814 TEU vessels which we chartered to the A.P. Moller Maersk Group for five years each. We also added to our fleet the newly built 9,580 TEU CSCL Le Havre which is one out of 19 more scheduled new deliveries to follow in the next four years.

"During the fourth quarter of 2006 the market experienced relative weakness as some overcapacity fears coupled with the low profitability and in many cases the losses of the liner companies prompted concerns over the industry. However, despite this underlying weakness liner companies have regained pricing power during the fourth quarter in some of their routes on the back of strong growth and high trade volumes. Tonnage demand from the charter market has accelerated driving the charter rate indexes higher while the actual rise has been much more pronounced in the larger vessel sizes above 3,000 TEUs.

“During the first months of 2007 we increased our order-book by four 6,800 TEU vessels. Danaos’ total orders now stand at 19 large size containerships of a total of 102,324 TEUs equivalent to 73% of our current fleet.”

Three months ended December 31, 2006 compared to the three months ended December 31, 2005

During the quarter ended December 31, 2006, Danaos had an average of 27.9 containerships and 6.0 drybulk carriers in its fleet as opposed to 25.0 containerships and 7.0 drybulk carriers for the same period of 2005. We took delivery of the CSCL Le Havre, a 9,580 TEU vessel on November 20, 2006 and three 4,814 TEU vessels, Maersk Marathon, Maersk Messologi and Maersk Mytilini, on December 13, 18 and 22 of 2006 respectively.

Our net income was $30.6 million or $0.57(3) per share for the fourth quarter of 2006 compared to $0.52(3) per share or net income of $23.2 million for the fourth quarter of 2005, an increase in net income of 31.9%.

Operating Revenue

Operating revenue increased 22.2%, or $12.6 million, to $69.2 million in the quarter ended December 31, 2006, from $56.6 million in the quarter ended December 31, 2005. The increase was mainly a result of the addition to our fleet of six vessels, the MOL Confidence, a 4,651 TEU containership on March 23, 2006, the CSCL Pusan, a 9,580 TEU vessel on September 8, 2006, the CSCL Le Havre, a 9,580 TEU vessel on November 20, 2006 and three 4,814 TEU vessels, Maersk Marathon, Maersk Messologi and Maersk Mytilini, on December 13, 18 and 22 of 2006 respectively, which collectively contributed revenues of $7.6 million during the three months ended December 31, 2006. Our drybulk carriers generated an additional $0.4 million in revenues during the three months ended December 31, 2006 compared to the three months ended December 31, 2005 as a result of higher charter rates for the period.

Vessel Operating Expenses

Vessel operating expenses increased 8.7%, or $1.3 million, to $16.2 million in the quarter ended December 31, 2006, from $14.9 million in the quarter ended December 31, 2005. This increase was due to the addition to our fleet of six vessels.

Depreciation & Amortization

Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.

Depreciation

Depreciation expense increased 33.9%, or $2.3 million, to $9.1 million in the quarter ended December 31, 2006, from $6.8 million for the quarter ended December 31, 2005. The increase in depreciation expense was due to the increase in the number of vessels in our fleet during the quarter ended December 31, 2006.

Amortization of Deferred Dry-docking and Special Survey Costs

Amortization of deferred dry-docking and special survey costs expense increased 33.3%, or $0.4 million, to $1.6 million in the quarter ended December 31, 2006, from $1.2 million in the quarter ended December 31, 2005. This was due to the costs of dry-docking and special surveys conducted for nine of our vessels during 2006.

General and Administrative Expenses

General and administrative expenses increased 43.8%, or $0.7 million, to $2.3 million in the quarter ended December 31, 2006 from $1.6 million in the same quarter of 2005, reflecting $0.3 million of technical management fees we paid for the six new vessels that entered our fleet during the quarter ended December 31, 2006 and $0.4 million of directors and officers’ remuneration expense which was not applicable in the quarter ended December 31, 2005.

Other Operating Expenses

Other Operating Expenses include Voyage Expenses

Voyage Expenses

Voyage expenses were $2.3 million in the quarter ended December 31, 2006, the same as in the quarter ended December 31, 2005.

Interest Expense and Interest Income

Interest expense decreased $0.5 million, or 6.2%, to $6.4 million in the quarter ended December 31, 2006, from $6.9 million in the quarter ended December 31, 2005. Interest income was $1.1 million for the quarter ended December 31, 2006, the same as for the quarter ended December 31, 2005, due to decreased bank deposits on which interest was earned being offset by higher interest rates. The decrease in interest expense was primarily due to the financing of our extensive newbuilding program which resulted in capitalizing $2.8 million of interest for the quarter ended December 31, 2006 as opposed to $1.5 million capitalized interest for the quarter ended December 31, 2005.

EBITDA

EBITDA for the quarter ended December 31, 2006 increased $9.7 million, or 26.2%, to $46.6 million in the quarter ended December 31, 2006, from $36.9 million in the quarter ended December 31, 2005. A table with analytical EBITDA calculations reconciling EBITDA to net income can be found at the end of this document.

Twelve months ended December 31, 2006 compared to the twelve months ended December 31, 2005

During the twelve months ended December 31, 2006, we had an average of 26.3 containerships and 6.4 drybulk carriers in our fleet. During the twelve months ended December 31, 2005, we had an average of 25.0 containerships and 7.0 drybulk carriers in our fleet. We took delivery of the MOL Confidence, a 4,651 TEU containership, on March 23, 2006, the CSCL Pusan, a 9,580 TEU vessel on September 8, 2006, the CSCL Le Havre, a 9,580 TEU vessel on November 20, 2006 and three 4,814 TEU vessels, Maersk Marathon, Maersk Messologi and Maersk Mytilini acquired on December 13, 18 and 22 of 2006 respectively and sold one drybulk carrier on May 12, 2006.

Our net income was $101.1 million or $2.16(4) per share for 2006 compared to net income of $122.9 million or $2.77(4) per share for 2005. The decrease was primarily due to the decrease of revenues of our dry bulk carriers offset by the increased of income derived by the new additions to our fleet.

Operating Revenue

Operating revenue increased 1.7%, or $4.2 million, to $245.6 million in the twelve months ended December 31, 2006, from $241.4 million in the twelve months ended December 31, 2005. The increase was mainly a result of the additions of six vessels to our fleet the MOL Confidence, a 4,651 TEU containership, on March 23, 2006, the CSCL Pusan, a 9,580 TEU vessel on September 8, 2006, the CSCL Le Havre, a 9,580 TEU vessel on November 20, 2006 and three 4,814 TEU vessels, Maersk Marathon, Maersk Messologi and Maersk Mytilini acquired on December 13, 18 and 22 of 2006 respectively that collectively contributed revenues of $13.4 million in 2006, which was offset by $25.1 million decrease in revenue generated by our drybulk carriers, which are deployed on short-term time charters, due to lower charter rates, and the affect of the sale of Sofia III, a drybulk carrier, which was made on May 12, 2006.

Vessel Operating Expenses

Vessel operating expenses increased 12.6%, or $6.8 million, to $60.7 million in the twelve months ended December 31, 2006, from $53.9 million in the twelve months ended December 31, 2005. This increase was due to a general increase in running costs per vessel experienced by the industry, and the increase in the average number of vessels in our fleet during the twelve months ended December 31, 2006. This increase was also partly due to the enhanced maintenance related to the increased number of vessels which had drydockings in the first twelve months of 2006 as opposed to those in 2005.

Depreciation & Amortization

Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.

Depreciation

Depreciation expense increased 14.8%, or $4.0 million, to $31.1 million in the twelve months ended December 31, 2006, from $27.1 million for the twelve months ended December 31, 2005. The increase in depreciation expense was due to the increase in the number of vessels in our fleet during the twelve months ended December 31, 2006.

Amortization of Deferred Drydocking and Special Survey Costs

Amortization of deferred drydocking and special survey costs expense increased 38.5%, or $1.5 million, to $5.4 million in the twelve months ended December 31, 2006, from $3.9 million in the twelve months ended December 31, 2005. This was due to the costs of drydocking and special surveys conducted for nine of our vessels in the twelve months ended December 31, 2006.

General and Administrative Expenses

General and administrative expenses increased 49.0%, or $2.5 million, to $7.6 million in the twelve months ended December 31, 2006 from $5.1 million in the twelve months ended December 31, 2005, reflecting $1.4 million of additional directors and officers’ remuneration expense which was not applicable in the twelve months ended December 31, 2005 and $1.1 million of technical management fees we paid in respect of the additional vessels that entered our fleet during the twelve months ended December 31, 2006, as well as our new management agreement, which was in effect during the second half of the year ended December 31, 2005.

Gain/(loss) on sale of vessels

Gain/(loss) on sale of vessels of $15.0 million for the twelve months ended December 31, 2006 reflects the sale of the Sofia III to a third party drybulk operator for $27.5 million.

Other Operating Expenses

Other Operating Expenses include Voyage Expenses

Voyage Expenses

Voyage expenses were $7.3 million in the twelve months ended December 31, 2006, representing a decrease of $0.2 million, or 3.2%, from $7.5 million in the twelve months ended December 31, 2005.

Interest Expense and Interest Income

Interest expense increased $5.8 million, or 24.9%, to $29.2 million in the twelve months ended December 31, 2006, from $23.4 million in the twelve months ended December 31, 2005.

The change in interest expense was primarily due to the increase in interest rates to which our indebtedness, on which we paid interest, was subject to, while there was no significant change in the average indebtedness for the full twelve months ended December 31, 2006 as compared to the twelve months ended December 31, 2005. The increase in interest expense was partially offset by the financing of our extensive newbuilding program which resulted in capitalizing $8.3 million of interest for the twelve months ended December 31, 2006 as opposed to $5.3 million capitalized interest for the twelve months ended December 31, 2005.

Interest income was $3.6 million for the twelve months ended December 31, 2006, a decrease of $2.7 million, from $6.3 million for the twelve months ended December 31, 2005. The decrease in interest income was due to the decreased monthly average bank deposits on which we earned interest, offset in part by higher interest rates.

Other income/(expense)

Other expense, net of $(16.6) million for the twelve months ended December 31, 2006 included a non recurring expense of approximately $(13) million related to the expected increase in the put option price we expect to pay under the leasing arrangements for the CSCL Europe, the CSCL America, the Maersk Derby, the Vancouver Express, the CSCL Pusan and the CSCL Le Havre, if the put option is exercised 6-1/2 years into the lease terms, as a result of a change in the United Kingdom tax legislation enacted in 2006.

Loss on derivatives

Gain (loss) on derivatives decreased $9.4 million to $(6.6) million in the twelve months ended December 31, 2006, from $2.8 million in the twelve months ended December 31, 2005. This decrease is a result of our interest rate swaps and the change in the fair value of foreign exchange forward transactions related to our leasing arrangements in respect to the CSCL Europe, the CSCL America, the Maersk Derby, the Vancouver Express, the CSCL Pusan and the CSCL Le Havre. Since the end of the second quarter of 2006, pursuant to the adoption of a formal hedge accounting policy we expect such fluctuations to be minimal in the future.

EBITDA

EBITDA decreased $7.7 million, or 4.5%, to $163.3 million in the twelve months ended December 31, 2006, from $171.0 million in the twelve months ended December 31, 2005. A table with analytical EBITDA calculations reconciling EBITDA to net income can be found at the end of this document.

Dividend Payment

On January 18, 2007 we declared a dividend of $0.44 per common share for the fourth quarter of 2006 for all shareholders on record as of January 29, 2007 which was paid on February 14, 2007. We currently intend to pay quarterly dividends of $0.44 per share, or $1.76 per share per year.

Recent News

During March 2007 Danaos Corporation entered into new shipbuilding contracts for 4 more large containership vessels, each of 6,800 TEUs, with scheduled delivery dates during 2010. The total contractual capital expenditure commitment for these orders is in the region of $400 million. Further, we have delivered the 5,506 TEU APL England to APL following the exercise of the call option APL had for this vessel. The sale consideration was $44.6 million. We have also delivered two more bulk carriers, the Roberto C and the Maria C to their new owners.

Conference Call and Webcast

On Thursday, March 8, 2007 at 11:30 A.M. EST, the Company’s management will host a conference call to discuss the results.

Conference Call details:

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 866 819 7111 (from the US), 0800 953 0329 (from the UK) or +44 (0)1452 542 301 (from outside the US). Please quote “Danaos”

In case of any problems with the above numbers, please dial 1 866 869 2352 (from the US). 800 694 1449 (from the UK) or +44 (0)1452 560 304 (from outside the US). Quote “Danaos”

A telephonic replay of the conference call will be available until March 14, 2007 by dialing 1 866 247 4222 (from the US), 0800 953 1533 (from the UK) or +44 (0)1452 550 000 (from outside of the US). Access Code: 1186615#

Slides and audio webcast:

There will also be a live and then archived webcast of the conference call through the Danaos website (www.danaos.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

About Danaos Corporation

Danaos Corporation is an international owner of containerships, chartering its vessels to many of the world’s largest liner companies. Its current fleet of 30 containerships aggregating 134,631 TEUs ranks Danaos among the largest containership charter owners in the world based on total TEU capacity. Danaos is the largest US listed containership company based on fleet size and market capitalization. Furthermore, the company has on order 19 additional containerships aggregating 102,324 TEU with scheduled deliveries up to 2010. The company’s shares trade on the New York Stock Exchange under the symbol “DAC.”

Forward-Looking Statement

Matters discussed in this release may constitute forward-looking statements within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although Danaos Corporation believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, Danaos Corporation cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charterhire rates and vessel values, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled drydocking, changes in Danaos Corporation’s operating expenses, including bunker prices, dry-docking and insurance costs, actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.

Risks and uncertainties are further described in reports filed by Danaos Corporation with the U.S. Securities and Exchange Commission.


(1) Based on basic and diluted weighted average number of shares for the
respective period.
(2) EBITDA is a NON-GAAP financial measure. Please see below for the
reconciliation of EBITDA to Net Income.
(3) Based on basic and diluted weighted average number of shares for the
respective period.
(4) Based on basic and diluted weighted average number of shares for the
respective period.
Visit our website at www.danaos.com
Appendix

Fleet Utilization

Danaos had 22 off-hire days due to scheduled dry-docking & special survey operations and 2 unscheduled off-hire days in the fourth quarter. The following tables summarize vessel utilization and the impact of the off-hire days relating to the last four quarters.

First Second Third Fourth
Quarter Quarter Quarter Quarter
2006 2006 2006 2006 2006
--------- --------- --------- --------- ---------
No. of No. of No. of No. of No. of
Vessel utilization Days Days Days Days Days
--------- --------- --------- --------- ---------
Ownership days 2,889 2,953 2,967 3,123 11,932
Less Off-hire Days:
Scheduled Dry-
docking (74) (49) (22) (145)
Other Off-hire
Days (2) (1) (2) (2) (7)
Operating Days 2,813 2,952 2,916 3,099 11,780
--------- --------- --------- --------- ---------
Vessel Utilization 97.4% 100.0% 98.2% 99.2% 98.7%

First Second Third Fourth
Quarter Quarter Quarter Quarter
2006 2006 2006 2006 2006
--------- --------- --------- --------- ---------
Revenue - Impact of
Off-hire(in ‘000s
of US dollars) Revenue Revenue Revenue Revenue Revenue
--------- --------- --------- --------- ---------
100% fleet
utilization $ 56,416 $ 60,034 $ 62,940 $ 69,720 $ 249,110
Less Off-hire:
Scheduled
Dry-docking (1,821) (1,066) (455) (3,342)
Other Off-hire
Days (59) (35) (48) (38) (180)
--------- --------- --------- --------- ---------
Actual Revenue
Earned $ 54,536 $ 59,999 $ 61,826 $ 69,227 $ 245,588
Fleet List
The following table describes in detail our fleet deployment and current employment profile as of March 7, 2006.

Vessel
Size Year Charter Expiration of
Vessel Name (TEU) Built Term(1) Charter(1) Charterer
------ ----- ---------- -------------- ----------------
Containerships
CSCL Pusan 9,580 2006 12 years September 2018 China Shipping
CSCL Le Havre 9,580 2006 12 years November 2018 China Shipping
CSCL America 8,468 2004 12 years November 2016 China Shipping
CSCL Europe 8,468 2004 12 years August 2016 China Shipping
APL Belgium 5,506 2002 6 years January 2008 APL-NOL
APL Holland 5,506 2001 6 years July 2007 APL-NOL
APL Scotland 5,506 2001 6 years June 2007 APL-NOL
Maersk Marathon 4,814 1991 5 years December 2011 AP Moller
Maersk Messologi 4,814 1991 5 years December 2011 AP Moller
Maersk Mytilini 4,814 1991 5 years December 2011 AP Moller
Hyundai Commodore 4,651 1992 8 years May 2011 Hyundai
Hyundai Duke 4,651 1992 8 years April 2011 Hyundai
MOL Confidence 4,651 1994 6.5 years November 2012 Hyundai
Maersk Derby 4,253 2004 5 years April 2009 Maersk
Vancouver Express 4,253 2004 5 years March 2009 Maersk
Norasia Hamburg 3,908 1989 5 years January 2008 COSCO
YM Yantian 3,908 1989 8 years September 2011 Yang Ming
YM Milano 3,129 1988 3 years July 2008 Yang Ming
Victory I 3,098 1988 3 years July 2007 Norasia
Independence 3,045 1986 3 years June 2007 Wan Hai
Henry 3,039 1986 3 years May 2007 Wan Hai
CMA CGM Elbe 2,917 1991 5 years August 2010 CMA-CGM
CMA CGM Kalamata 2,917 1991 5 years August 2010 CMA-CGM
CMA CGM Komodo 2,917 1991 5 years August 2010 CMA-CGM
Pacific Bridge 2,130 1984 3 years March 2008 Hapag-Lloyd
Eagle Express 1,704 1978 2.5 years October 2007 Hapag-Lloyd
Bareboat
Containerships
Maersk Constantia 3,101 1979 2.0 years April 2008 Maersk
S.A. Helderberg 3,101 1977 2.0 years December 2007 Maersk
S.A. Sederberg 3,101 1978 2.0 years January 2008 Maersk
S.A. Winterberg 3,101 1978 2.0 years March 2008 Maersk
Drybulk Carriers(2) (DWT)
MV Achilleas 69,180 1994 1 year April 2007 Baumarine (pool)


(1) Earliest date charters could expire. Most charters include options to
extend their term.
(2) We have agreed to sell this vessel upon expiration of its current
charter. Under the leading “Expiration of Charter” we include the
expected month of delivery of this vessel to its new owner.
New Deliveries
The following table describes the expected additions to our fleet as a result of our new building program as well as two expected second hand acquisitions, as of March 7, 2006.

Expected Time Expiration
Vessel Delivery Charter of
Vessel Name Size (TEU) Date(1) Term Charter(1) Charterer
---------- ---------- ---------- ---------- ----------
Newbuildings
HN 1639 4,253 Sept. 2007 12 years 2019 Yang Ming
HN 1640 4,253 Nov. 2007 12 years 2019 Yang Ming
HN 1670 4,253 July 2008 12 years 2020 Zim
HN 1671 4,253 Sept. 2008 12 years 2020 Zim
HN 1672 4,253 Nov. 2008 12 years 2020 Zim
HN 1673 4,253 Dec. 2008 12 years 2020 Zim
HN 1698 4,253 Mar. 2009 12 years 2021 Zim
HN 1699 4,253 June 2009 12 years 2021 Zim
HN S4001(2) 6,500 April 2009 12 years 2021 CMA-CGM
HN S4002(2) 6,500 June 2009 12 years 2021 CMA-CGM
HN S4003(2) 6,500 Aug. 2009 12 years 2021 CMA-CGM
HN S4004(2) 6,500 Oct. 2009 12 years 2021 CMA-CGM
HN S4005(2) 6,500 Dec. 2009 12 years 2021 CMA-CGM
HN Z 00001 6,800 2010 - - -
HN Z 00002 6,800 2010 - - -
HN Z 00003 6,800 2010 - - -
HN Z 00004 6,800 2010 - - -
Secondhand
E.R. Auckland 4,300 Mar. 2007 12 years 2019 Yang Ming
E.R. Wellington 4,300 Sept. 2007 12 years 2019 Yang Ming


(1) Although the expected delivery dates are as set forth in the table
above, the contracted delivery dates for our contracted vessels are
as follows: HN 1639—December 31, 2007; HN 1640—November 30, 2007; HN
1670—July 31, 2008; HN 1671—October 31, 2008; HN 1672—November 30,
2008; HN 1673—December 31, 2008; HN 1698—March 31, 2009; HN 1699—
June 30, 2009; E.R. Auckland—March 2007; E.R. Wellington—September
15, 2007 to October 15, 2007; HN S4001—April 30, 2009; HN S4002—
June 30, 2009; HN S4003—August 31, 2009; HN S4004—October 31, 2009;
HN S4005—December 31, 2009.
(2) Vessel subject to charterer’s option to purchase vessel after first
eight years of time charter term for $78.0 million.




DANAOS CORPORATION
Statement of Operations
(Expressed in thousands of United States
dollars, except per share amounts)


Three Three Twelve Twelve
Months Months Months Months
Ended Ended Ended Ended
December December December December
31, 2006 31, 2005 31, 2006 31, 2005
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (audited)

Operating Revenues $ 69,227 $ 56,648 $ 245,588 $ 241,381

Operating Expenses:
Vessel operating
expenses (16,204) (14,901) (60,742) (53,883)
Depreciation &
amortization (10,652) (7,941) (36,536) (31,036)
General &
administrative (2,310) (1,566) (7,574) (5,058)
Gain on sale of vessels - - 14,954 -
Other operating
expenses (2,315) (2,313) (7,703) (7,725)
----------- ----------- ----------- -----------
Income from Operations 37,746 29,927 147,987 143,679
----------- ----------- ----------- -----------

Other earnings
(expenses):
Interest income 1,069 1,124 3,605 6,345
Interest expense (6,442) (6,866) (29,240) (23,415)
Other finance income
(cost), net (457) (1,832) 1,938 (7,081)
Other income (expense) (1,329) 591 (16,580) 491
Gain (loss) on
derivatives (25) 290 (6,628) 2,831


----------- ----------- ----------- -----------
(7,184) (6,693) (46,905) (20,829)
----------- ----------- ----------- -----------

Net Income $ 30,562 $ 23,234 $ 101,082 $ 122,850
=========== =========== =========== ===========

Earnings per share,
basic and diluted $ 0.57 $ 0.52 $ 2.16 $ 2.77
=========== =========== =========== ===========

Basic and diluted
weighted average
number of shares in
‘000 54,000 44,308 46,751 44,308




DANAOS CORPORATION
Balance Sheets
(Expressed in thousands of United States dollars)

December 31, December 31,
2006 2005
-------------- --------------
Assets (unaudited) (audited)
Current Assets:
Cash and cash equivalents $ 43,075 $ 38,000
Restricted cash 2,493 724
Accounts receivable 2,170 14,107
Other current assets 11,962 11,181
-------------- --------------
59,700 64,012
Non-Current Assets:
Vessels 1,016,608 654,222
Advances for vessel acquisitions and vessels
under construction 205,366 173,725
Deferred charges, net 9,399 7,758
Fair value of financial instruments 5,832 1,422
Other assets 285 44,619
-------------- --------------
1,237,490 881,746

-------------- --------------
Total Assets $ 1,297,190 $ 945,758
============== ==============

Liabilities and Stockholders’ Equity
Current Liabilities:
Long term debt, current portion $ 22,760 $ 57,521
Accounts payable, accrued liabilities & other
current liabilities 21,488 12,963
Fair value of financial instruments, current
portion 1,466 -
-------------- --------------
45,714 70,484
Long-Term Liabilities:
Long term debt 639,556 609,217
Fair value of financial instruments, net of
current portion 5,775 3,332
Other liabilities 40,293 -
-------------- --------------
685,624 612,549
Stockholders’ Equity
Common Stock 546 443
Additional paid-in capital 288,530 90,529
Other comprehensive income 3,941 -
Retained earnings 272,835 171,753
-------------- --------------
565,852 262,725

-------------- --------------
Total Liabilities and Stockholders’ Equity $ 1,297,190 $ 945,758
============== ==============




DANAOS CORPORATION
Statement of Cash Flows
(Expressed in thousands of United States dollars)


Three Three Twelve Twelve
Months Months Months Months
Ended Ended Ended Ended
December December December December
31, 2006 31, 2005 31, 2006 31, 2005
----------- ----------- ----------- -----------
Cash provided by (unaudited) (unaudited) (unaudited) (audited)
(used in):
Operating Activities:
Net earnings $ 30,562 $ 23,234 $ 101,082 $ 122,850
Adjustments to
reconcile Net Earnings
to Cash from Operating
Activities:
Depreciation 9,088 6,787 31,111 27,114
Amortization of
deferred charges 1,699 1,255 5,560 4,023
Written off amount of
deferred charges 278 (68) 781 -
Change in fair value of
financial instruments (216) (192) 5,733 (1,939)
Payments for
drydocking/special
survey (1,012) (49) (8,037) (4,505)
Loss (gain) on sale of
vessels - - (14,954) -
Accounts receivable (387) 623 (3,034) 4,676
Other assets short and
long-term 3,205 3,728 (1,066) 13,317
Accounts payable and
accrued liabilities 1,275 (810) 5,775 (2,688)
Other liabilities short
and long-term 172 (1,731) 28,627 (613)
----------- ----------- ----------- -----------
Cash from operating
activities 44,664 32,777 151,578 162,235
----------- ----------- ----------- -----------

Investing Activities:
Vessel acquisitions
including advances (131,102) - (171,749) (12,350)
Vessels under
construction (18,966) (14,150) (185,148) (28,188)
Proceeds from sale of
vessels - - 26,798 -
----------- ----------- ----------- -----------
Cash used in investing
activities (150,068) (14,150) (330,099) (40,538)
----------- ----------- ----------- -----------

Financing Activities:
Debt draw downs 296,892 - 434,971 400,000
Debt repayment (378,542) (20,624) (447,765) (339,937)
Contributions 201,259 201,259
Dividends on common
shares - - - (244,593)
Deferred costs (1,402) (980) (3,100) (1,771)
Decrease (increase) in
restricted cash (2,478) (145) (1,769) 5,596
----------- ----------- ----------- -----------
Cash from financing
activities 115,729 (21,749) 183,596 (180,705)
----------- ----------- ----------- -----------
Net change in cash and
cash equivalents 10,325 (3,122) 5,075 (59,008)
Cash and cash
equivalents, at
beginning 32,750 41,122 38,000 97,008
----------- ----------- ----------- -----------
Cash and cash
equivalents, end of
period $ 43,075 $ 38,000 $ 43,075 $ 38,000
=========== =========== =========== ===========

Cash paid for interest 3,951 7,239 26,352 24,283
Non-cash capitalized
interest on vessels
under construction 607 1,537 6,079 5,275
Non-cash lease
liability rel/d to
vessel acq. - - 14,416 -




DANAOS CORPORATION
Reconciliation of Non-GAAP Financial Measures
(Expressed in thousands of United States dollars)


Three Three Twelve Twelve
Months Months Months Months
Ended Ended Ended Ended
December December December December
31, 2006 31, 2005 31, 2006 31, 2005
----------- ----------- ----------- -----------
Net Income $ 30,562 $ 23,234 $ 101,082 $ 122,850
Depreciation 9,088 6,787 31,111 27,114
Amortization of
deferred charges 1,564 1,154 5,425 3,922
Interest income (1,069) (1,124) (3,605) (6,345)
Interest expense 6,442 6,866 29,240 23,415
----------- ----------- ----------- -----------
EBITDA(1) $ 46,587 $ 36,917 $ 163,253 $ 170,956
=========== =========== =========== ===========


(1) EBITDA represents net income before interest, income tax expense,
depreciation and amortization. However, EBITDA is not a recognized
measurement under U.S. generally accepted accounting principles, or
“GAAP.” We believe that the presentation of EBITDA is useful to
investors because it is frequently used by securities analysts,
investors and other interested parties in the evaluation of companies
in our industry. We also believe that EBITDA is useful in evaluating
our ability to service additional debt and make capital expenditures.

In addition, we believe that EBITDA is useful in evaluating our
operating performance and liquidity position compared to that of other
companies in our industry because the calculation of EBITDA generally
eliminates the effects of financings, income taxes and the accounting
effects of capital expenditures and acquisitions, items which may vary
for different companies for reasons unrelated to overall operating
performance and liquidity.